Energy Prospectus

Kodiak Oil & Gas Corp. Provides Williston Basin Operations Update
Down-spaced Bakken Well Yields Consistent IP Rates;
Three Forks Test Demonstrates Productive Potential of Prolific New Pay Horizon

Press Release Source: Kodiak Oil & Gas Corp. On Wednesday January 5, 2011, 8:00 am
DENVER, Jan. 5, 2011 /PRNewswire/ -- Kodiak Oil & Gas Corp. (NYSE Amex: KOG), an oil and gas exploration and production company with assets in the Williston Basin of North Dakota and Montana and in the Green River Basin of southwest Wyoming and Colorado, today provided an interim update on its Williston Basin oilfield activities.

Kodiak currently operates a two-rig-drilling program in the Williston Basin, with one rig running in Dunn County, N.D. and the second rig drilling ahead in McKenzie County, N.D. The Company has contracted a third rig which is projected to be drilling late in the first quarter of 2011. In addition, Kodiak's joint venture partner, ExxonMobil, spud the FBIR 34X-25 well in Dunn County during the fourth quarter of 2010, in which Kodiak holds a 50% working interest.

As of December 31, 2010, the Company was producing approximately 2,700 barrels of oil equivalent per day (BOE/d), which is in line with previously announced projections. While final average daily production numbers are not yet compiled for the fourth quarter of 2010, the Company anticipates that production should approximate the previously announced estimate of 2,100 BOE/d. Winter conditions in North Dakota caused curtailment of the transportation of crude oil, resulting in most of Kodiak's wells being shut in for several days during late December.
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rest of report here-----

http://finance.yahoo.com/news/Kodiak-Oi ... 5.html?x=0

apparently the mkt doesn't like it??

The exit rate of 2,700 boepd was below my forecast of 3,000 boepd but the 4th quarter production rate is right at what I have in my forecast model. I'm holding with my Fair Value estimate of $8/share for Kodiak.

raymond james' take----------(stolen from IV kog bd)


Kodiak Oil & Gas Corp. January 6, 2011

(KOG:AMEX) Company Brief

John Freeman, CFA, (713) 278-5251, John.Freeman@RaymondJames.com

Kristal Choy, (713) 278-5261, Kristal.Choy@RaymondJames.com

Thomas Pauly, Sr. Res. Assoc., (713) 278-5265, Thomas.Pauly@RaymondJames.com

Exploration and Production ____________________________________________

Kodiak: Showing Off Three Forks Potential, But Valuation Still Concerns Us

♦ Showing off its Three Forks potential. In its operations update released this morning,

Kodiak announced three recent well results including two Bakken wells and one Three

Forks test. In the company’s first Three Forks test at Two Shields Butte, the #14-21-33-16H3

well came on at 1,042 Boe/d (92% oil) despite completing just 6 of 22 planned frac stages.

Could the company's Three Forks potential be better than its Bakken potential in Dunn

County? This result would make it appear so, but nearby operator results show conflicting

data. Kodiak will be returning to complete the remaining 16 stages in 1Q11, and noted that

despite also only partially completing its Moccasin Creek #13-34-28-2H, the well ended up

as one of the company’s best wells yet when fully completed. Currently, we are only giving

minimal value for the Three Forks so clearly that could ultimately drive our net asset value

higher (if all of Dunn County proved prospective for the Three Forks it would increase our

NAV/share by nearly $2 from $5.65 to roughly $7.50 (assuming $100/bbl long-term oil price).

♦ Solid Bakken results, downspacing test initially positive. While Kodiak is experiencing

winter-related setbacks in the Williston, the company was still able to complete two of its

four Two Shields Butte wells in December. The first, the longer lateral TSB #14-21-33-15H,

IP'd at a healthy 2,030 Boe/d. The well was spaced just 1,350’ away from an existing

producer, and initially exhibited some pressure communication between reservoirs;

however, post completion the well appears to be producing independently. Should the

long-term performance of the well hold up despite its proximity to current production, the

results would lend support to potential 320-acre spacing, which could increase the

company’s Bakken inventory by 35%. The second well, a short lateral well with 11 stages

(TSB #14-21-4H) came on at 1,196 Boe/d and slightly below previous shorter lateral wells,

with the last three Moccasin Creek wells coming on in the 1,400-1,500 Boe/d range.

♦ Drilling going as planned despite inclement winter weather. During the quarter Kodiak

moved forward on two longer lateral Bakken wells on its current four well pad in Dunn

County. The TSB #2-24-12-2H reached total depth during the quarter, and Kodiak also spud

the Skunk Creek #2-24-25-15H. Completion work on the two wells should commence in

2Q11. The remaining two wells on the pad will be longer lateral Three Forks wells. In

McKenzie County at its Koala area, Kodiak completed drilling on a two well pad that

includes both a Bakken and Three Forks well which are due to be completed in 1Q11. An

additional two well pad initiated drilling as well, and Kodiak will drill two 9,000’, 50%

working interest wells at the unit. Finally at Koala, the company plans to complete the

short-lateral Grizzly #13-6H Bakken well in January 2011 with seven stages. For a complete

inventory of Kodiak’s Williston Basin drilling and completions activity, please refer to the

charts on the following page.

♦ Production where it’s supposed to be, but valuation still makes us nervous. On the

production front, the company announced that it exited 2010 at 2.7 Mboe/d and 4Q10

production likely averaged 2.1 Mboe/d, both in-line with guidance and our expectations.

On an EV per Bakken acres basis, Kodiak is not cheap at $12,700 per Bakken acre, which is

well above recent industry transactions. KOG currently trades above our total NAV/share

estimate ($5.65 using $100/bbl), but it should be noted that the NAV is extremely sensitive

to both higher oil prices and well results. We maintain our Market Perform rating as we

await more results that can help confirm the accuracy and repeatability of the company’s

750-850 Mboe EUR guidance and Three Forks potential.






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interesting trade of thoughts from the IV kog bd

Kodiak said they would have the Four Well Pad Completed by Year End. I said BULL!
They barely finished drilling the 4th Well of the Four Well Pad. Kodiak started completion approx Nov. 18th. There was NO WAY they would Completed the 4 Wells drilled in a Month and Half.

Kodiak is taking over 40 Days just to Drill(Not Complete) one Well.

Kodiak said there Year End Exit Rate would far exceed 2,500 BOE/d. Kodiak Exit Rate was 2,700 BOE/d BUT that included 500 BOE/d that was just acquired with the New Leases.

NOW, if you weren't looking; Kodiak just pushed back the Next Four Well Pad completion into the 2nd Quarter from the 1st quarter.
I been posting for a long time that this would happen because Kodiak has only drilled One of the Four Wells.

Kodiak; especially Mr. Peterson really stretches the truth. He is in the same league as Mr. Reeves(atpg guy); remember him.

Now Kodiak's third Operated Rig has been push back to LATE 1st Quarter.

Very Best of Luck.
ED


Drilling and completions are two different animals, for completions they are at the mercy of the service companies. They are a small operator and not a high priority. You either accept this or you don't .

Regarding your TMR analogy, not even close. Kog has valuable acreage is producing oil, not ngas. Their production is increasing and debt is not an issue. Finally Exxon is going to be partnering with them, do you think Exxon would mess with them if their acreage was not prime? Exxon will have no trouble drilling wells and getting their acreage fraced promptly.

Kodiak's oil production is increasing which means their revolver limits will increase and not decrease. They have no long term debt, put your TMR goggles back in your pocket.

There were 168 rigs runnnig in the Bakken it is not surprising there were bottlenecks completing wells and not surprising a little company like KOG with a couple of rigs was not the priority. On top of that it is now winter time and it is freakin cold in North Dakota, expect delays. But delays will not change the fundamentals I rode Bexp and fully expect to make money here, the only question is how much.

Wilk